Getting a loan when you do not have a job is one of the hardest things in personal finance. In North Dakota, many people face periods without work because of seasonal industries, temporary layoffs, or limited opportunities in small towns. Even in a state with one of the lowest unemployment rates in the country, some residents cannot find steady jobs for months. At the same time, life does not stop. Rent must be paid, groceries must be bought, and medical bills arrive even if there is no paycheck. This is why the question of whether an unemployed person can get a loan in North Dakota is important.
Unemployed People Statistics in North Dakota
North Dakota is one of the states with the strongest job markets in the United States. In July 2025, the unemployment rate was about 2.5%. That means that out of every one hundred workers, fewer than three were unemployed. The national unemployment rate at the same time was about 4%. Thus, the unemployment rate in North Dakota was lower than the national average in the US.
The picture is not equal across all counties. For example, in Dickey County, the unemployment rate in June 2025 was 1.8%. In Rolette County, the rate was 8.1%. This is a very big difference. It shows that people in some regions face far more difficulty finding jobs. Rural and tribal areas often have higher rates because there are fewer employers and fewer industries.
The total number of unemployed people in the state was about 12,300 in the third quarter of 2024. This figure is significant because it reminds us that even in a state with low unemployment, many families still struggle to make ends meet without a steady income. These families may need loans more than others. Their ability to obtain them depends on how lenders perceive the risk.
Who Is Considered Unemployed by Traditional Lenders
Traditional lenders tend to have a strict view when deciding who is considered unemployed. They usually put people into the following groups:
- People who have lost a full-time or part-time job and are currently unemployed.
- People who left a job voluntarily and do not have another steady source of wages.
- People who are not working but are actively looking for work.
- People who receive unemployment benefits because they do not have current employment.
- People who may earn money from temporary jobs but do not have a steady contract or fixed income.
- People who rely on irregular work, such as occasional cash jobs that cannot be documented with pay stubs or tax forms.
From the lender’s point of view, all these categories are considered risky because they do not guarantee future payments. Even if someone has skills or savings, the absence of regular wages places them in the group considered unemployed.
Why It’s Hard for the Unemployed to Get a Loan
Lenders want to make sure they will get their money back. The primary method for verifying this is by examining the borrower’s income. A job is the strongest proof that money comes in every month. When a person is unemployed, this proof is missing.
Even a good credit score is not enough if there is no income. A lender may see that you paid past loans on time but still worry about how you will pay the next one. This is why applications from unemployed people often get denied. If the lender approves, it may be only for a very small amount with a very high cost.
Lenders also face legal rules. If a borrower cannot repay, the lender must follow collection laws that protect consumers. This adds cost for the lender. As a result, lenders prefer applicants who demonstrate a reliable income. An unemployed person must explore alternative ways to demonstrate repayment ability.
Eligibility Rules Set by State and Lenders
In North Dakota, the Department of Financial Institutions controls payday lenders, installment lenders, and credit unions. They must hold valid licenses and comply with the law.
For payday loans, the rules are strict. The maximum loan amount is $500. The total amount of outstanding payday loans cannot be more than $600 at the same time. The lender can charge a maximum fee of 20% of the loan. The loan term can be up to 60 days. A borrower can cancel the loan until 5:00 p.m. of the next business day without incurring any penalty. Only one rollover is allowed. After that, the loan must be repaid in full.
For installment loans, the maximum annual percentage rate is 36%. Payments must be equal and made on a monthly basis. A late fee cannot be higher than 5% of the missed payment. The lender must give a clear contract that shows the total cost. This is also required by federal law under the Truth in Lending Act.
All lenders must be licensed. Borrowers can verify a company’s legitimacy by checking its license on the state’s website. This is important because illegal lenders may charge more than allowed and use unfair practices.
Alternatives to Traditional Income Proof
Unemployed people can sometimes prove repayment ability with other sources of income. Lenders may accept the following:
- Unemployment benefits. Weekly payments from the state can be used as proof of income.
- Social Security or disability payments. These are stable and often last for years, which makes them acceptable to lenders.
- Child support or alimony. Court-ordered payments can serve as a reliable income.
- Rental income or investment income. If you own property or have dividends, this can be used.
- Savings or bank balances. If you have money in the bank and can show records, it may help.
Types of Loans With No Income in ND
There are several credit products available for the unemployed:
Payday Loans
Payday loans are short-term loans for small amounts of money. In North Dakota, the maximum amount is $500. The fee can be as high as 20%. If you borrow $400, you must pay back $480. The loan must be paid within 14 to 60 days. You can roll it over once, but the balance must then be cleared. The total outstanding payday loans cannot be more than $600. These loans are expensive because the annual cost can reach over 400%.
Installment Loans
Installment loans allow for larger amounts and longer repayment periods. The annual percentage rate is limited to 36%. Payments must be equal and monthly. A borrower can take from a few hundred $ to several thousand, depending on the lender. If you borrow $2,000 for one year at 30% APR, the monthly payment would be about $193. This is more manageable than a payday loan, but it’s still costly without a steady income.
Personal Loans From Credit Unions
Credit unions often provide small personal loans with lower rates than payday or installment lenders. They may approve unemployed members if they can demonstrate receipt of unemployment benefits, savings, or a co-signer. For example, some credit unions offer emergency loans ranging from $500 to $1,000 with interest rates below 20%. Repayment periods typically range from 6 to 12 months. This is usually a safer option.
Cash Advance
Cash advances work like payday loans. The maximum loan is $500 with a 20% fee. If you borrow $300, you will repay $360. The loan must be paid within 30 to 60 days. They are often linked to debit cards or checking accounts. They are quick, but costly, and should be used only in emergencies.
Risks and Limits of Borrowing While Unemployed
Borrowing without a job is dangerous. The main risks include:
- High cost of credit. Payday loans can have annual rates over 400%. Even installment loans at 36% are costly compared to bank loans.
- Debt cycle. If you cannot repay on time, you may be eligible to borrow again. This results in repeated fees and increased debt.
- Credit score damage. Late payments or default will lower your credit score. This makes future borrowing more difficult.
- Collection stress. Lenders may contact you or take legal steps if you miss payments. Although the law limits their actions, the stress remains very high.
Support Programs and Resources for Unemployed Residents
Unemployed residents in North Dakota can use several forms of assistance. The state unemployment insurance program provides weekly payments for those who qualify. This money can be used for living costs and also as proof of income for loan applications.
Community Action Agencies across the state offer help with rent, utilities, and food. Programs like the Low-Income Home Energy Assistance Program help families pay their heating bills during the winter. Food banks and the Supplemental Nutrition Assistance Program help reduce grocery costs.
Housing programs can help prevent eviction and reduce rent costs. Nonprofit groups and local churches may also provide emergency funds. Credit counseling agencies offer free advice on managing debt and planning a budget.
By using these supports first, you can avoid taking a high-cost loan. They reduce pressure and give you more time to find work.
Steps to Improve Chances of Getting Approved
If you still want to apply for a loan, there are ways to improve your approval chances. These steps can help:
- Gather all documents that prove income, such as unemployment benefits or child support.
- Consider a co-signer with stable income and good credit.
- Apply at a credit union instead of payday lenders for safer terms.
- Continue to pay bills on time to protect your credit score.
- Borrow only the amount you really need and no more.
- Compare different lenders and choose the one with the lowest cost.
- Use the one-day cancellation right if you change your mind.
- Continue to use state and community assistance to reduce borrowing needs.
By following these steps, you will show lenders that you are responsible. You will also reduce risk for yourself.
Key Takeaways on Borrowing Unemployment Loans in ND
North Dakota has one of the lowest unemployment rates in the country; yet, thousands of people still live without a steady income. For them, loans are possible but difficult. Payday loans are limited to $500 with high fees. Installment loans allow larger amounts, but interest can reach 36%. Credit unions may be the safest choice.
The law protects borrowers with clear rules on fees, terms, and licensing. Support programs such as unemployment insurance, housing aid, and food assistance can reduce the need to borrow. To improve approval chances, unemployed people should show alternative income, use co-signers, and choose the smallest amount possible.
Loans should be a last resort. Before taking one, consider the cost and repayment carefully. Use all available support. Protect your credit and your future.